ETHUSD Perspective And Levels: Broader Higher Low Forming.

29 Jul 2017

ETHUSD Update:Multiple day higher low forming in low volume environment as 8/1 gets nearer. As long as price stays below the 208 resistance, it is likely to gyrate within the 183 to 163 support zone.

Everyone is waiting for the outcome of 8/1 and the low volume serves as evidence. Nothing unusual about this especially in light of the constant ICO scams and questionable broker emails about halting trading and withdrawals. Most of this month has felt like a waiting game that will come to a conclusion on Tuesday.

Until then, it is reasonable to expect price to drift and I would like to see this market find stability within the 183 to 163 area which is relative to the .618 of the recent upswing. If price can present a reversal pattern on a smaller time frame, or a simple candle reversal on this time frame or above, it would solidify a broad higher low (see swing lines on chart) and provide an attractive reward to risk opportunity.

Keep in mind on 8/1 ANYTHING can happen and technical analysis can not help us anticipate wild random movements. With that being said if my setup appears before Tuesday, I will take a small position (5% of usual size) and not place a stop. Not using a stop is not something I would recommend, especially to new participants, and I am compensating for the additional risk with smaller size. If there is a wild move on Tuesday it may be in both directions and the majority of nearby stops will likely be taken out. If ETH goes to 0, can I handle the loss. If ETH has a wild gyration and finds stability, I will have a small position that I can build on, along with protecting myself with stop orders AFTER 8/1.

If price finds stability and does not go below 163, there will be a very bullish higher low in place, but in order to open the door to higher prices, the 208 (.382 of current bear swing) must be taken out. Beyond that, the 227 to 241 resistance zone is just below the .382 of the broader bearish swing and needs to also be taken out to continue the broader uptrend. If that scenario unfolds after 8/1, it is possible to see the 300s in a matter of days.

In terms of wave counts, this can be labeled as a Wave 2 of a broader 3. If that is the case, and price starts pushing the resistances mentioned above, the coming wave can be the wave that takes this market to new all times highs. A solid catalyst must accompany this market in order to make a Wave 3 of that magnitude possible. Just something to be aware of.

In summary, this market is poised to resume the broader uptrend. It is anyone's guess how price action will unfold on 8/1 and technical analysis will not help until after the event is absorbed into the system. I am willing to take a small position only if my plan allows, and it will be adjusted for any wild gyrations that may result Tuesday. Until then I expect price action to behave more randomly within this low volume environment.

Questions and comments welcome.